Illinois State Universities Retirement System, Champaign, hired Invesco and Pacific Investment Management Co. to run $336 million in commodities funds, following board approval Friday.
It is the $16.8 billion pension fund’s first move into the asset class.
SURS will invest $252 million in the Invesco balanced-risk commodity trust, a commingled fund, and $84 million in the PIMCO Commodity Alpha Fund, a hedge fund.
The hirings are pending contract negotiations. The funding source could not be learned by press time.
An RFP was issued in June. The other finalists were CoreCommodity Management and Pinnacle Asset Management.
The hirings are the result of an asset/liability study last year calling for a 2% allocation to commodities. NEPC assisted in the search and recommended the 75%/25% allocation split.
Separately, the pension fund hired Segal Co. to provide actuarial audit services to evaluate the work of its actuarial firm, Gabriel Roeder Smith.
An RFP was issued last month.
SURS is conducting the audit as practice of due diligence. Its last actuarial audit was in 2012.
Also, the pension fund announced it had consolidated its four real estate investment trust portfolios into two global portfolios without changing managers to save $60,000 a year in fees and gain other efficiencies, while keeping the passive and active management split.
It combined BlackRock’s $127 million passive U.S. and $263 million passive global portfolios into a single $390 million passive global portfolio, while also combining CBRE Clarion’s $151 million active U.S. and $102 million active global portfolios into a single $253 million active global portfolio.
In addition, the board reaffirmed SURS’ 7.25% investment return assumption.